Standard Chartered $1.3bn pre-tax profit highest in decade

… projects strong growth fundamentals

Sunil Kaushal, CEO, Standard Chartered, AME, has said that the achievement of $1.3 billion in annual profit for Africa and the Middle East (AME), the highest in a decade, is a testament to the bank’s continued dedication to client success and strategic growth initiatives.

“We remain committed to connecting global markets and providing clients with valuable investment opportunities and solutions, further solidifying our position as the group’s fastest-growing region,” Sunil said in a statement.

The 2023 Strategic Report has unveiled solid growth fundamentals for Standard Chartered based on diverse metrics. These include a significant percentage rise in operating income, substantial profit before the tax increase, strong border income growth, a widened loan net, leadership in the transition to the net zero goal and an improved cost-to-income ratio.

Breaking down the milestones, underlying profit before tax (PBT) of $1.311billion was up 66percent and the highest annual profit since 2015 driven by higher income and a net release in credit provisions partially offset by an increase in expenses while operating income of $2.806 billion was up 14percent with strong growth in Cash Management, Retail Deposits and Financial Markets. Income was up by 29percent in the Middle East, North Africa, and Pakistan and up 1percent in Africa.

The bank widened its loan and advances net, with loan to customers up by 8percent YoY and customer accounts were up by 4percent since December 31, 2022, just as risk-weighted assets were 6percent than previous year despite the impact of sovereign downgrades due to continuing RWA optimisation activities, de-risking in markets with elevated macro-economic risk and currency devaluation.

Credit Impairment net release of $91 million in full year 2023 compared to $119 million charge in FY22 reflects a non-repeat of the prior year’s sovereign related impairments and releases relating to historic CCIB provisions.

Return on Tangible Equity (RoTE) increased to 16.6percent from 9.3percent in 2022, as Standard Chartered Bank topped the regional DCM league tables for the tenth consecutive year and secured the first rank in GCC G3 Bond and Sukuk issuance. The bank also recorded strong cross-border income growth of 39percent with broad-based growth across key corridors.

The drive to further embed international banking proposition and activate diverse footprint across Africa and the Middle East resulted in more than 150percent growth in Priority Banking client base across international banking corridors for Africa and the Middle East. Further on actions leading to impressive results, an improvement in productivity was recorded, with income per headcount (up 18percent year-on-year) Performance highlights.

Standard Chartered Bank became the first international bank with digital fixed income solutions in Kenya, Nigeria and Ghana while extending the micro-investment solution (SC Shillingi) to Uganda and launching digital personal loans in Kenya.

With a rich Africa and the Middle East (AME) heritage founded on deep client relationships and historical contributions to the economy and the communities, the bank is improving its unique footprint in the region while also focusing on centres across Asia, Europe and the Americas towards further growth.

Signifying how the bank is well placed to facilitate further trade and investments across the regions, priority areas include providing best-in-class structuring and financing solutions, accelerating growth in differentiated international network, investing in market-leading digitisation initiatives in CPBB to protect and grow market share in core markets and effectively playing the role of industry leader in the transition to net zero across the region.